The Silvan Elves confine themselves to the northernmost regions of the forest, and Men begin to call it Mirkwood.
Thrain I, King of Durin’s folk and distant ancestor of Thorin Oakenshield, comes to the Lonely Mountain and founds a dwarf-kingdom. There, the Dwarves discover their most prized treasure, the Arkenstone, known also as the Heart of the Mountain.
In the past centuries, the increase in power of the Necromancer of Dol Guldur has been responsible for the slow but steady diminishing of the inhabitants of the vales of the Great River. In the year 2063, the Wizard Gandalf finally enters the fortress to investigate the matter (songs and legends of the Woodmen have him led through Mirkwood by the young son of a hunter). The shadow over Mirkwood weakens and many folks that were forced to leave return to their lands: the Woodmen multiply and prosper in the following years, establishing settlements both east and west of the Great River.
Thorin I, son of Thrain, removes the royal house of Durin’s folk from Erebor to abide in the Grey Mountains. He carries the Arkenstone with him, as part of the royal treasure.
Answering commands issued from their master in Dol Guldur, the Orcs begin to spread in the dark places beneath the Misty Mountains. From Mount Gundabad in the north to Moria in the south they secretly strengthen every stronghold, barring all the passes into the lands west of the mountains. To respond to the increasing threat from the mountains, the Woodmen of the western river vales raise their burg at Mountain Hall, building upon the foundations of an older fortification.
The Arkenstone is brought back to its place in the Great Hall of Thrain, and with it returns a great part of Durin’s folk. They mine and tunnel the roots of the Mountain, enlarging the subterranean kingdom building huge halls and greater workshops. Another group of Dwarves is led eastward where they eventually settle in the Iron Hills. About this time, several clans of Northmen living along the River Running move north to be closer to the Lonely Mountain. They befriend the Dwarven colony of Erebor, attracted by the opportunities offered by the brisk trade with the Iron Hills. The city of Dale prospers, and the following hundred years see it become the capital of a strong kingdom extending far and wide to the East and South.
Between the end of 2758 and the first months of 2759, stiff, relentless winds hit the North, covering the lands with snow and ice. The Long Winter has come, and King Bladorthin dies before he sees the end of it. He is succeeded by his young son Girion, who drives his enemies back to the eastern frontiers of the realm. For five months, the Long Winter causes great suffering and inflicts grievous losses on many peoples. Gandalf the Grey himself intervenes, coming to the aid of the Shirefolk.
One night, Smaug the Dragon descends on the Lonely Mountain spouting flames. The Dwarves are caught by surprise and Erebor is sacked, its inhabitants slain. Warriors from Dale are destroyed too, and Girion their lord is killed. Thror, the King Under The Mountain, escapes the slaughter by secret means with his son Thrain. They are joined in exile by Thorin, the young son of Thrain. The Dragon claims the underground halls of Erebor as his lair, and its treasure becomes his hoard. From the Mountain, Smaug starts preying upon the neighbouring lands, killing people and livestock and reducing the surrounding area to a wasteland. Some time later, Dale is deserted and slowly crumbles to ruins.
The final battle of the War of the Dwarves and Orcs is fought before the East-gate of Moria. The Dwarves are victorious, and a very young Dain Ironfoot distinguishes himself by killing Azog singlehandedly. But victory has a bitter taste: the war has greatly reduced the number of Orcs still dwelling in the mountains, but at the cost of a frightful number of lives. After the battle, the various Houses part ways without attempting to reclaim Moria, and the Dwarves are dispersed again to the four winds: Dain Ironfoot returns to the Iron Hills. Thrain and his son Thorin wander westwards, to eventually settle in the Blue Mountains to the northwest.
An extremely fierce and long cold season begins in November. Remembered as the Fell Winter, its frozen grip doesn’t release the regions of the North from snow and ice for five months. Rivers and lakes are frozen over, and white wolves descend from the frozen wastes of the far North. When the frigid winds finally relent in March of the following year, rivers overflow with the melting of the snow and many lands are flooded as a result. It is about this time that the Long Marshes spread extensively, extending from the Old Forest Road to the Forest River.
The Wizard Gandalf, Thorin Oakenshield and thirteen Dwarven companions visit Bilbo the Hobbit in the Shire: they set upon a quest to recover the treasure of Durin’s Folk and free the North from the threat of the Dragon of Erebor. A series of unlikely events lead to the death of Smaug and to the destruction of Lake-town. D in of the Iron Hills becomes King of the restored Kingdom under the Mountain, while Dwarves, Men and Elves collaborate in rebuilding new cities in Dale and upon the Long Lake.
The creature Gollum leaves his lair under the Mountains and begins his search for the thief of the Ring. Some time later, he enters Mirkwood, to eventually reach Esgaroth and even the streets of Dale. For a while he is watched closely by the Wood-elves.
In the last days of November, on the fifth anniversary of the eponymous battle, a great feast celebrating the victory at the Battle of Five Armies is held in Dale for the first time. People from all neighbouring lands are expected to participate in the revels, as the feast has been arranged to coincide with local celebrations held for the end of the harvest season and the beginning of the colder months of the year.